Senators introduce AHA-supported bill granting extension of Medicare payment model for rural hospitals

Sens. Chuck Grassley, R-Iowa, and Michael Bennet, D-Colo., April 30 introduced the Rural Community Hospital Demonstration Reauthorization Act, legislation that would grant a five-year extension to a Medicare payment model for rural hospitals. The model provides cost-based Medicare reimbursement for hospitals with fewer than 51 beds that do not qualify as critical access hospitals. Under the model, hospitals are reimbursed for service costs rather than fixed Medicare rates that do not account for hospital expenses. 

“Many rural hospitals face financial uncertainty from low patient volumes, sicker patient populations, a challenging payer mix, geographic isolation, and shifts in care delivery,” said Lisa Kidder Hrobsky, AHA senior vice president for advocacy and political affairs. “The Rural Community Hospital (RCH) Demonstration Extension Act allows hospitals to continue providing essential care in their communities by supporting the financial stability of participating rural hospitals. Hospitals with 50 beds or less are some of the most vulnerable to closure and the RCH demo offers an important model to maintain access in rural communities around the country. The AHA thanks Senator Grassley and Senator Bennet for their strong leadership to support America’s rural hospitals.”